Tata Power, Torrent Power, CESC: How draft Electricity Bill 2025 may impact power cos
The proposals, which focus on improving power cost competitiveness, and streamlining tariff mechanisms, could have a material impact on power distribution companies such as Tata Power, Torrent Power, and CESC.
- Oct 13, 2025,
- Updated Oct 13, 2025 9:37 AM IST
The Ministry of Power has released the draft Electricity Amendment Bill 2025, seeking stakeholder feedback over the next 30 days. The proposals, which focus on fostering competition, improving power cost competitiveness, and streamlining tariff mechanisms, could have a material impact on power distribution companies such as Tata Power, Torrent Power, and CESC, according to Motilal Oswal Financial Services (MOFSL).
Among the three companies, MOFSL retained 'Buy' on Tata Power with a target price of Rs 480. It did not offer ratings on the other two.
"The draft highlights the sector's financial stress, with cumulative losses exceeding Rs 6.9 lakh crore as of FY25, which undermines demand growth and weakens the system's foundations. MoP has invited stakeholder comments within 30 days, after which the bill could be tabled in Parliament, with state-level buy-in being critical for its success. We retain positive view on the sector and top pick PGCIL, CESC," Antique Stock Broking siad.
The draft aims to allow multiple distribution licensees to share the same infrastructure, a move that could break regional monopolies and lower costs for industrial and commercial consumers. “This proposal is especially positive for distribution-focused utilities such as Tata Power, Torrent Power, and CESC,” MOFSL said. However, it cautioned that the implementation will depend heavily on state-level cooperation and clarity on cost-sharing mechanisms.
Among the other key reforms, the draft emphasizes cost-reflective tariffs, empowering regulators to revise tariffs suo motu, and increasing the number of members in APTEL (Appellate Tribunal for Electricity) to speed up dispute resolution. These steps are aimed at improving the financial health of discoms, long plagued by tariff deficits, cross-subsidies, and regulatory delays.
Another notable provision is the liberalisation of energy storage rules, granting consumers rights over storage systems—an important step as renewables gain share in the energy mix. This could enhance grid stability and reduce peak load pressure, creating opportunities for storage solution providers and renewable-linked utilities.
The draft also proposes reducing cross-subsidies for industrial, rail, and metro users, which could improve industrial competitiveness and lower logistics and transport costs.
MOFSL noted that while the bill is structurally positive for the sector, the pace of execution and state-level alignment will be key factors to watch.
The Ministry of Power has released the draft Electricity Amendment Bill 2025, seeking stakeholder feedback over the next 30 days. The proposals, which focus on fostering competition, improving power cost competitiveness, and streamlining tariff mechanisms, could have a material impact on power distribution companies such as Tata Power, Torrent Power, and CESC, according to Motilal Oswal Financial Services (MOFSL).
Among the three companies, MOFSL retained 'Buy' on Tata Power with a target price of Rs 480. It did not offer ratings on the other two.
"The draft highlights the sector's financial stress, with cumulative losses exceeding Rs 6.9 lakh crore as of FY25, which undermines demand growth and weakens the system's foundations. MoP has invited stakeholder comments within 30 days, after which the bill could be tabled in Parliament, with state-level buy-in being critical for its success. We retain positive view on the sector and top pick PGCIL, CESC," Antique Stock Broking siad.
The draft aims to allow multiple distribution licensees to share the same infrastructure, a move that could break regional monopolies and lower costs for industrial and commercial consumers. “This proposal is especially positive for distribution-focused utilities such as Tata Power, Torrent Power, and CESC,” MOFSL said. However, it cautioned that the implementation will depend heavily on state-level cooperation and clarity on cost-sharing mechanisms.
Among the other key reforms, the draft emphasizes cost-reflective tariffs, empowering regulators to revise tariffs suo motu, and increasing the number of members in APTEL (Appellate Tribunal for Electricity) to speed up dispute resolution. These steps are aimed at improving the financial health of discoms, long plagued by tariff deficits, cross-subsidies, and regulatory delays.
Another notable provision is the liberalisation of energy storage rules, granting consumers rights over storage systems—an important step as renewables gain share in the energy mix. This could enhance grid stability and reduce peak load pressure, creating opportunities for storage solution providers and renewable-linked utilities.
The draft also proposes reducing cross-subsidies for industrial, rail, and metro users, which could improve industrial competitiveness and lower logistics and transport costs.
MOFSL noted that while the bill is structurally positive for the sector, the pace of execution and state-level alignment will be key factors to watch.